Among other precious metals, spot silver was steady at $18.58 per ounce, platinum eased 0.2% to $871.43, and palladium slipped 1.5% to $2,001.62.
After rising above the $2,000-per-ounce level in early March due to the Ukraine war, gold has corrected more than $250, or 12% amid rate hike by Fed and a strong dollar. In Indian markets, gold had hit ₹55,200 in mid-March before succumbing to selling pressure.
“COMEX gold rates trade modestly lower near $1724/oz as US dollar index and bond yields paused after recent correction. Market players are now positioning for Fed decision on Wednesday. Expectations of a 75 basis points rate hike has already been factored in and market players want more clarity if Fed may slow down the pace of rate hikes going ahead to address the challenges to the economy," said Ravindra Rao, VP- Head Commodity Research at Kotak Securities.
"Gold is also pressurized by weaker investor demand and concerns about consumer demand in India and China. Gold has come off the lows but may remain directionless ahead of Fed decision but the general bias is still weak unless US central bank gives clear indication of slowing down the rate hikes," he said.
Last week, the European Central Bank raised interest rates by 50 bps to combat soaring inflation. Though gold is seen as a hedge against inflation, rising interest rates increase the opportunity cost of holding bullion.
“Gold has support at $1712-1700, while resistance is at $1738-1747. Silver has support at $18.42-18.30, while resistance is at $18.95-19.15. In rupee terms, gold has support at ₹50,540–49,310, while resistance is at Rs50,860–50,990. Silver has support at Rs54,650-54,210, while resistance is at Rs55,580–56,110," said Rahul Kalantri, VP Commodities, Mehta Equities Ltd.
(With Agency Inputs)
